Crackdown on Excessive Flaring and Venting: CNOOC Fined by UK Regulator

On a mission to tighten the noose on excessive flaring and venting on the UK Continental Shelf (UKCS), Great Britain’s regulator, North Sea Transition Authority (NSTA), has imposed a penalty of £125,000 (around $153,824) on a European affiliate of China’s state-owned oil and gas giant for breaching its venting consent on two separate occasions at a field located 60 miles northeast of Aberdeen.

As the NSTA continues its crackdown on venting and flaring lack of oversight, CNOOC Petroleum Europe, a subsidiary of China National Offshore Oil Corporation (CNOOC), has become the sixth North Sea operator to be fined for excessive flaring or venting in the past two years.

As explained by the regulator, venting refers to natural gas, primarily methane, being emitted directly into the atmosphere without combustion, while flaring occurs when excess gas is burned off, mainly resulting in CO2 emissions. The North Sea Transition Authority claims that CNOOC is being fined for venting without consent at its Buzzard field in the North Sea twice within a fortnight.

After the firm detected a leak in the line that supplies fuel needed to keep the flame lit on Buzzard’s flare stack on May 31, 2022, it shut off the fuel line and began venting excess gas into the atmosphere, unignited. The company confirmed to the NSTA on June 1 that it had breached the annual consent for Buzzard.

Yet, it still continued venting until a fault with a generator led to production operations shutting down two days later. Once CNOOC restarted production and export activities from Buzzard on June 9, further venting took place because of a faulty valve on the fuel gas system.

The company continued to produce and vent through to June 13, despite being fully aware that it did not have valid consent for additional venting, exceeding its annual limit for Buzzard by 435.13 tons of gas between May 31 and June 13, according to the UK regulator. A revised consent, which was granted on June 14, ended up bringing the field back in compliance mode for any further venting during the rest of 2022.

The NSTA has confirmed that the company cooperated throughout the investigation and introduced measures to prevent recurrences, including improved monitoring and a new approach to consent applications. Previously, the firm had only requested consent to vent minimal volumes of gas, as venting was uncommon on Buzzard.

CNOOC teamed up with Flotation Energy to form a new company in charge of developing the Green Volt floating offshore wind farm with up to 30 turbines to facilitate the decarbonization of the oil and gas industry through the complete electrification of the Buzzard oil and gas field with the support of a fully connected UK grid connection back to the New Deer substation in Aberdeenshire.

While urging operators to ensure compliance with regulations, the UK regulator underlined: “It is crucial that licensees comply with regulatory obligations to show they are operating their assets responsibly and assist the UK’s move towards net zero – safeguarding public and investor confidence in the sector.

“Flaring and venting make up about one-fifth of the UK oil and gas industry’s offshore production emissions. While some flaring and venting is unavoidable for safety and operational reasons, more must be done to reduce the amount of gas being emitted via these processes.”

Since 2022, the NSTA has imposed £825,000 in financial penalties for flaring and venting breaches. The regulator’s OGA Plan, published in March 2024, places a strong emphasis on the need to slash emissions, requiring industry to adopt electrification or other low-carbon measures to reduce production emissions. 

However, the regulator also recently wrote to operators to warn them about the changes in the starting point for considering fines related to breaches of flaring and venting regulations from January 1, 2025. The new starting point is £500,000.

Jane de Lozey, NSTA’s Director of Regulation, commented: “North Sea operators have taken up the challenge of cutting flaring and venting, almost halving emissions from these processes since 2018. However, at a time when the industry is competing for investment, and its commitment to the energy transition is under intense scrutiny, it is vital that all operators remain vigilant on emissions.”  

CNOOC’s fine comes after NEO got a penalty of £100,000, which came on the heels of the £160,000 fine Repsol was presented with for a flaring and venting breach and three operators getting a fine totaling £265,000, as NSTA moved to enforce net zero and security of supply requirements.

In addition, Shell and BP were each fined £50,000 for breaching production consents and license breach, respectively.